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Interesting message by Nilepet MD on Nilepet Facebook account

Christmas Message from the Managing Director of Nilepet

Dear Nilepet Staff, Partners, and Contractors,

On this joyous Christmas Day, I extend my warmest wishes to you and your families. May this season bring you peace, happiness, and cherished moments with your loved ones.

This year has been one of challenges and resilience. Yet, our commitment to hope and determination fuels my belief that 2025 will be a year of progress and growth for Nilepet. Under the leadership of H.E. Salva Kiir Mayardit, President of the Republic of South Sudan, and with the diligent supervision of the Ministry of Petroleum, we are laying the foundation for a brighter future for our company and our nation.

I am pleased to share that Nilepet is actively collaborating with our partners to expedite the resumption of oil production in Blocks 3 and 7.

Additionally, we are in constructive discussions with Petronas to conclude its divestment process in South Sudan, ensuring a smooth transition and alignment with our strategic objectives.

Looking ahead, Nilepet is firmly focused on building a path to sustainable growth. Key initiatives include:

1. Completing the acquisition of PCNL’s participating interest in the three Joint Operating Companies (JOCs).

2. Resuming oil production in Blocks 3 and 7.

3. Rejuvenating the Bentiu Refinery to enhance downstream operations.

4. Strengthening Nilepet’s cash flow to sustain operations, salaries, and support growth.

Despite the hardships we faced in 2024, I am proud to report that we have managed to pay salaries up to November and are working tirelessly to ensure December salaries are also disbursed. This achievement reflects our shared commitment to the well-being of our workforce.

As we embark on this journey, I would like to express my heartfelt gratitude to Nilepet esteem board of directors members under the leadership of Hon. Amb. Chol Mawut Unguec Ajongo and Colleagues at the Minsitry of Petroleum for the support and cooperation. I would like to also express gratitude and appreciation to each member of the Nilepet family, your dedication, perseverance, and positive contributions have been instrumental in navigating through challenges and driving forward.

May the spirit of Christmas inspire us all to continue striving for excellence and unity. Together, let us make 2025 a year of remarkable achievements for Nilepet and South Sudan.

Merry Christmas and a prosperous New Year to you all.

With best wishes,

Eng. Ayuel Ngor Ayuel Kacgor,

Managing Director & CEO,

Nile Petroleum Corporation.

https://www.facebook.com/share/19Ymqno5Z7/?mibextid=wwXIfr

Patience Will Be Rewarded: I completely understand the frustrations that have been expressed, but we are on the cusp of what could be the most robust 12 months in our company's recent history. Let's give the company the time it needs to return to the market in a robust and healthy state, poised for significant growth. I've never been more optimistic about our prospects since the suspension began than I am right now. With the announcements made earlier in December and the comprehensive operational update, our outlook for 2025 has never looked brighter.

Moreover, there's more happening behind the scenes than just the South Sudan deal. I am genuinely convinced that while we push forward with that opportunity, we are also actively engaged in negotiating another significant deal. So, I truly believe that 2025 will mark a pivotal step change for our company. For example the South Sudan deal was signed with Petronas on 14 October 2022 and announced to the market 12 December 2022. That's a 2 month gap, remember the timing of when deals are signed and when they are announced to the market can be different the company is not obliged to inform the market immediately. Something to bear in mind even if we were to return to market without another deal I would happily be a patient shareholder as there is plenty of growth in the company in it's current form without a deal plus i wouldn't want to be out in case the company returns to market without a deal and strikes another deal which this time completes I would be well gutted.

Remember folks the timing of deals announced to the market can differ from when the company announces it to the market, therefore with or without a deal I would be gutted to sale on re-listing if the company go on to a deal which this time comes through a few months after re-admission. besides from out suspended share price of 26.25p the 2025 programme provides the upside with or without any deal.

As expected didn’t expect much from this RNS, let’s kick off the year now with a few other positive rns for example solve completion etc and other news will also be welcome.

As for South Sudan news I am still struggling to believe the another energy company is wildcat as caution mentioned tiddler is that why Savannah are playing along and and an affiliate and not a subsidiary has signed this deal. Secondly wildcat have explicitly mentioned that they are collaborating to acquire the ex-Petronas assets with Nilepet so I wonder why Savannah is omitting to explicitly mention wildcat it’s not as if it’s new news unless this company isn’t wildcat. For all we know it could be a company in South Sudan like trinity energy run by be Benjamin Bol Mel who also is keen to get a share in Petronas assets or it could be Nilepet or someone entirely different but more credible than wildcat petroleum.

I could be wrong but this whole wildcat thing still seems a bit of a front to me if I honest although could be wrong

Savannah Energy to Acquire Petronas’ Portfolios in Chad

The acquisition of Petronas’ portfolios in Chad by Savannah Energy is another example of the challenges posed by government intervention in M&A activities in Africa. The deal, involving Petronas’ stakes in several oil blocks, is part of Savannah’s broader strategy to build a diversified energy portfolio across the continent. However, the Chadian government has been actively involved in the transaction, raising concerns over the strategic implications of the sale. The government has insisted on renegotiating key terms of the contracts, including those related to revenue sharing, local content, and environmental obligations. Moreover, there have been delays in obtaining the necessary regulatory approvals, with the government demanding additional assurances regarding Savannah’s long-term commitment to the country’s oil sector. These interventions have added layers of complexity to the deal, reflecting the broader challenges of executing M&A transactions in Chad’s highly regulated and politically sensitive environment.

With $16 billion dollar worth of deals in the pipeline one would hope that eventually one of these deals will eventually as mentioned we need one of these deals to come through to transform the company. Nigeria recent divestment approvals is positive for us as we have operations in Nigeria already so let's hope we are able to target those deals, also Angola recent oil and gas reform is making mature fields attractive so it would be nice for savannah to get a foothold in Nigeria, not to mention Petronas Egypt assets still up for sale and we have already been the preferred bidder for Chad and South Sudan, let's hope we Petronas view us favourably for it's Egypt assets too we clearly have a strong relationship with them.

https://energychamber.org/wp-content/uploads/The-State-of-African-Energy-2025_digital.pdf

The report highlights challenges faced with the deals also

Savannah Energy Acquires Petronas’ South Sudan Portfolio

Savannah Energy’s acquisition of Petronas’ South Sudan portfolio has been a focal point of government intervention in the region’s oil sector. The deal, which involves Petronas’ stakes in several key oil blocks, is part of Savannah’s strategy to expand its footprint in Africa. However, the South Sudanese government has been deeply involved in the transaction, with the Ministry of Petroleum exercising significant influence over the approval process. The government has imposed conditions on the deal, including the requirement for Savannah to invest in local infrastructure and contribute to social development projects. Additionally, concerns over the security situation in the region and the need for assurances on the continuity of operations have further complicated the transaction. The government’s active role in shaping the deal underscores the importance of navigating political and regulatory landscapes in M&A activities in South Sudan, where government priorities can significantly impact the success of such transactions. Savannah has now canceled its planned $1.25 billion acquisition of Petronas operations in South Sudan, with the parties unable to complete the deal on the originally agreed terms.

Savannah Energy to Acquire ExxonMobil’s Upstream and Midstream Portfolios in Chad

Savannah Energy’s move to acquire ExxonMobil’s upstream and midstream portfolios in Chad has been marked by significant government interference, reflecting the complexities of operating in the country’s challenging political and regulatory environment. The transaction, which includes ExxonMobil’s interests in producing oil fields and a pipeline network, is strategically important for Savannah’s growth. However, the Chadian government has raised concerns over the deal, particularly regarding the valuation of the assets and the terms of the sale. The government has also sought to renegotiate key aspects of the existing contracts, including royalty payments and local content requirements. Additionally, there have been delays in securing regulatory approvals, with the government demanding more extensive due diligence on Savannah’s operational and financial capabilities. The situation highlights the risks associated with M&A in Chad, where government intervention can significantly alter the terms and timeline of a transaction.

The African Energy Chamber 2025 outlook report is an interesting read it cover the M&A outlook in 2025 and touches on existing deals and challenges:

Page 40 - "With approximately $16 billion worth of assets holding over 3 billion barrels of oil equivalent (boe) resources currently on the market, African upstream M&A activity is expected to remain robust, with some potential challenges from

government interventions. Nigeria, Equatorial Guinea, Côte d’Ivoire, Angola, and Egypt are expected to lead this activity, accounting for nearly 91% of the overall 2P reserves currently on the market. These assets are laid on market by majors and IOCs including TotalEnergies, Chevron, Eni and Petronas as a port of their portfolio rationalization initiatives. Regional

independents with growth ambitions, looking to capitalize on the favorable oil and gas environment, could target these assets due to the near-term production growth potential and immediate cash flow additions."

AK - Keeps on mentioning quote "we continue to pursue key acquisitions in the upstream oil and gas space" one would imagine that we are almost certain involved in these deals. Not to mention any other deals outside this such as the Africa intelligence article i posted on Algeria saying we are the only small independent able to negotiate with them. Awards will be made by "May 29, 2025."

https://energycapitalpower.com/algerian-outlines-licensing-opportunities-for-2024-bid-round/

Looks like the price $16bn / 3 billion reserves = $5.33 per barrel of oil acquisition cost. Now my guess is we are probably looking for certainty to see whether south sudan is a go or no go before execution of other deals. Against the backdrop of Sipec completion, niger production, doubling accugas revenues within the next 12 months and sanctioning renewable projects towards full funding and construction and chad Cameroon outcome.

Savannah pursues gas projects in Nigeria, as legal cases continue in Chad and Cameroon.

London AIM-listed Savannah Energy is aiming to complete construction work on the Uquo central processing facility project in Nigeria by year-end. Commissioning is to follow in Q1 2025 around the same time as it is due to secure full control of the Stubb Creek field. The positive developments in Nigeria are in contrast to the ongoing legal cases it is pursuing in Chad and Cameroon and a complex situation in South Sudan – but these issues could all be resolved by mid-2025.

Looks like the 6 -12 months are the biggest 12 months in Savannah history and I mean in a positive way personally a continued suspension may not be so bad if as the article alludes that all could be resolved by mid 2025 including the Chad and Cameroon cases and South Sudan.

https://www.africa-energy.com/news-centre/article/savannah-pursues-gas-projects-nigeria-legal-cases-continue-chad

Interesting Article below - Illudes to the inclusion of Nilepet, perhaps we will help Nilepet fund there share of working interest by providing a loan to them until it's paid back and than they end up with their working interest. I.e Nilepet doubles in size.

https://energynews.pro/en/savannah-energy-resumes-negotiations-for-petronas-oil-assets-in-south-sudan/

Savannah Energy resumes negotiations for Petronas’ oil assets in South Sudan

Despite initial obstacles, Savannah Energy persists in its attempt to acquire Petronas' oil assets in South Sudan, exploring alternative options to finalize a beneficial agreement.

After temporarily halting discussions regarding the acquisition of Petronas’ oil assets in South Sudan, Savannah Energy has resumed negotiations with a renewed strategic focus. These assets, which produced an average of 81,000 barrels per day (b/d) during the first ten months of 2024, are viewed as pivotal to the company’s energy ambitions.

On December 3, 2024, Savannah Energy announced its efforts to develop an “alternative transaction structure” in collaboration with various stakeholders, including Nilepet, the state-owned oil company of South Sudan. This strategy reflects a commitment to adapting to the complex realities of the sector and competing interests.

Wildcat Petroleum: A potential key partner

Among the stakeholders, Wildcat Petroleum could play a crucial role. The company signed a six-month collaboration agreement with Nilepet in September 2024, strengthening the likelihood of a multi-party transaction. While details remain unconfirmed, this partnership may facilitate the conclusion of negotiations.

Savannah Energy also indicated that a detailed update would be shared by mid-December or the end of the year, signaling potential progress. “We continue to believe that a transaction could be accretive for the company,” a company representative stated.

An ambitious growth strategy

Savannah Energy’s ongoing interest in these assets aligns with its long-term vision of expanding its oil and gas operations in Africa. The company sees these resources as critical to supporting its planned drilling campaign in Nigeria, where it intends to explore new development wells.

These projects exemplify a strategic drive to solidify its position in the energy sector, despite challenges posed by competition and local requirements.

By maintaining its efforts in South Sudan, Savannah Energy aims to fully leverage the potential of these oil assets while contributing to regional energy growth.

I firmly believe we will have at least 2 renewable projects that achieve financial close next year and it could be more...... We are still yet to see how the market is to price the renewable project especially having the bulk of the funding sorted for NIger wind farm. I think the renewables business was never priced into our sp prior to suspension but will be once we return the question remains how many p's will it add to our SP.

Value drivers across the portfolio

Savannah’s core business continues to perform strongly, highlighting the robustness of the Company’s business model. Production for 10M 2024 has averaged 22.7kboepd (10M 2023: 22.9kboepd), underpinned by 105MMscf/d of new and extended gas contracts. The Uquo and Stubb Creek marginal field oil mining leases have both been converted into new 20-year petroleum mining leases. Savannah benefits from over US$3.4bn of contracted future gas revenues in Accugas with annual price escalation clauses tied to US CPI. Future production growth is expected to be driven by the commissioning of the compression project at the Uquo CPF (expected 1Q25) and the SIPEC Stubb Creek acquisition (expected completion 1Q25). Savannah continues to progress the development of its renewable energy division, with the Company announcing an agreement with a development partner for a 150MW wind farm project which would expand Savannah’s footprint in West Africa.

—Upcoming catalysts. In Nigeria, the gas compression project at the Uquo CPF is on track to complete by YE24 (commissioning in 1Q25), enabling Savannah, through its Accugas midstream subsidiary, to increase gas production volumes in the years ahead. Further, Savannah is currently working on a proposed further development programme for the Uquo field which is expected to see an additional well drilled in 2H25. The Uquo NE well is forecast to provide gas volumes of 60-80MMscf/d. An additional exploration well at Uquo South is also currently under consideration, targeting an unrisked gross GIIP of 154Bcf of prospective gas resources. At Stubb Creek, the SIPEC acquisition is expected to complete in 1Q25 paving the way for the commencement of an extension programme, which is expected to increase production to 4.7kboepd within 12-months of completion of the acquisition.

In Niger, Savannah has optimised the development plan for the R3 East Area, with peak production now forecast at 10,000bopd (previously 5,000bopd) and a forecast PV10 value of US$210m (previously US$150m). The Niger-Benin export pipeline is now fully operational, providing a clear route to international markets for crude oil from the R1234 contract area.

The Renewable Energy Division continues to make progress with up to 696MW of renewable energy projects in motion and the expected announcement of Savannah’s entry into additional renewables projects, putting the Company on target to meet its 2GW+ goal by the end of 2026.

Elsewhere, Savannah expects the arbitral proceedings against the Government of the Republic of Chad to be concluded in 2H25. In aggregate, the claims are valued in excess of US$1bn.

South Sudan – Discussions continue. Following the termination of the original sale and purchase agreement with Petronas International Corp for the acquisition of its entire oil and gas business in South Sudan, Savannah remains in active discussions with the relevant parties regarding an alternative tra

Porschefund the other wind farm in west africa is in Mali - I believe it's the one below

https://www.rencore-energy.com/kayes-en

It was already reported in the past

https://x.com/uk_mali/status/1775457539347362299

Going for a smaller pie in South Sudan is a win win for Savannah as it will enable it to target other hydrocarbon deals in relatively better jurisdictions for example i posted the other week we are in negotations with Sonaratech in Algeria and we could be negotiating other deals.

Personally I think the market and the shareholder base would be more comfortable with a reduced Petronas share of the assets than gobbling up the lot, will allow us plenty of upside and free cash flow with a more cushioned risk profile whilst enabling us to pursue more deals.

I am convinced that Savannah have lined up other oil and gas deals it's just a case of sequencing of events "we continue to pursue key acquisitions in the upstream oil and gas space".

Interesting update on South Sudan seems to be referencing "with the likely involvement of multiple acquiring parties".

Looks like the Petronas share of assets will be split up, in the grand scheme of things even if we end up with 25% of Petronas share of production would be good all things considering I do feel this is a better outcome for Savannah too as it will ensure that we are not taking on material risk considering the jurisdiction, I wonder who else will we be partnering with Perenco seems obvious and comes to mind perhaps Tullow as well considering the comments it's CEO made around using a pipeline through Kenya to export South Sudanese oil.

South Sudan

As previously announced, Savannah continues discussions with the various stakeholders around an alternative transaction structure in relation to the proposed acquisition of the ex-PETRONAS assets in South Sudan. Savannah management believe that any transaction which would ultimately be completed would be on significantly different terms to that envisioned when the transaction was initially announced in December 2022 with the likely involvement of multiple acquiring parties. We continue to believe that a transaction could be potentially accretive to the Company and expect to provide a further update on progress made by mid to late December 2024.

Getting a foothold in Algeria would be transformational, a production asset with reserves and exploration upside would be amazing.

There are more reasons as to why Savannah has not yet returned to market that just the South Sudan deal, clearly more deals are being worked on and not only hinged on South Sudan.

Projects in green hydrogen

Bellahcene is also in regular contract with Mohamed Ould Noueigued, head of Mauritanian energy and infrastructure group AON. Icosium Investment also has a plant producing mobile service stations for mining sites in Mali and Senegal. After the explosion of oil storage depots in Conakry in late 2023, the company came forward with a proposal to build a new storage facility and to provide the financing necessary for its construction.

He can also rely on the connections of Houmed Msaidié, the former Comorian agriculture, environment, tourism and trades minister who is now special adviser' on political affairs to President Azali Assoumani. A memorandum of understanding was even signed with Comoros on oil products storage areas.

Given that his holding company is registered in Spain, Bellahcene is constantly on the watch for opportunities there. On 4 November, Icosium Investment became a shareholder in Spanish renewable energy and gas distribution company Holaluz.

Founded in 2010, Holaluz is listed on the Madrid stock exchange and supplies 500,000 clients. Icosium plans to invest nearly €22m for a 33% stake in the company and three seats on its board. One of its aims is to get into Spanish gas supply and, in the longer term, renewable energy, notably via the supply of green hydrogen from production plants in the Maghreb.

https://www.africaintelligence.com/north-africa/2024/11/19/lotfi-bellahcene-the-algerian-oil-sector-s-new-golden-boy,110341334-gra

Algeria

Lotfi Bellahcene, the Algerian oil sector's new golden boy

Trading, exploration and production, renewable energy and mining… The Franco-Algerian businessman has a wide-ranging portfolio, which has brought him success to date in Algeria, West Africa and, most recently, Europe.

At the age of 43, Franco-Algerian Lotfi Bellahcene has succeeded in making a name for himself in Algeria, sub-Saharan Africa and, most recently, in Europe. Via partnerships with trading houses like Vitol and Trafigura in the trading of oil products in the Maghreb and Africa more widely, he has succeeded in turning his holding company, Icosium Investment, into an enterprise worth several million dollars. Registered in Spain, the company is active in the trading of crude oil and oil products but also invests more widely in energy production. To help him develop its activities, the young businessman can rely on an efficient contact network in Algeria and sub-Saharan Africa.

Algeria is still the main base for his business activities. After beginning in trading, he gradually diversified into exploration and production. A long-standing friend of Yacine Wafy, the vice president of Savannah Energy, an oil junior established in Niger and Nigeria, Bellahcene played a key role in getting the company recognised by the Algerian oil industry regulatory authority, the Agence Nationale pour la Valorisation des Ressources en Hydrocarbures (ALNAFT).

Know-how and connections

This was no small feat, given that Algeria is a country generally open only to the majors or big independent operators. For nearly a year now, Savannah Energy has been one of the only juniors to be able to negotiate with Sonatrach for the right to operate permits in Algeria. Wafy, who has Nigerian and Algerian nationality, travels regularly to Algiers to ensure that he gets his permits as quickly as possible. He has been able to make use of Bellahcene's know-how and his connections at ALNAFT, Sonatrach and the energy ministry, headed by the long-serving Mohamed Arkab.

For the last 10 years, Bellahcene has also been the representative in Algeria of Nigerian oil company Oando. He was able to set up the partnership with the Lagos-based company, which is the current oil industry star in Nigeria, via its deputy CEO, Omamofe "Mofe" Boyo. The company's founder and chairman is Adewale Tinubu, nephew of Nigeria's current head of state, Bola Ahmed Tinubu.

In Ivory Coast, the Algerian has always been able to count on Adama Toungara, who is currently the national mediator but who was minister of oil and energy from 2011 to 2017 and is very close to President Alassane Ouattara. Bellacene is also reputed to be close to the existing oil minister, the powerful Mamadou Sangafowa Coulibaly.

There will be no shortage of growth in the accugas asset and we will certainly have a roll to play in this. Our pipeline practically strategically placed to deliver gas in the state. Whether we provide gas from our fields or third party gas feed from the Amocon style nearby fields but one thing is for certain our infrastructure will certainly be used in some capacity to get gas to the steel plant and new power plant. It may be good for Savannah to increase its 2p reserves of gas by consolidating gas reserves in oml 13 licence in and around our infrastructure we could easily get 1 - 2 tcf 2p reserves booked to be used through our accugas pipeline either through Amocon style feed or perhaps nnpc granting additional marginal fields around our infrastructure

https://punchng.com/indian-firm-to-offtake-gas-for-4bn-steel-plant/?amp

https://leadership.ng/4bn-steel-plant-jindal-group-commits-to-offtake-450mmscfd-natural-gas-federal-govt/

Clearly there is a perception that the South Sudan elites use the oil industry to line the pockets of elites, hence the Petronas divestment in country will be even more interesting and will have global attention from foreign aid agencies, government and World Bank etc., so the South Sudanese government elites will have to be careful in how they navigate this. One of the many reasons why the South Sudan elites want a Chinese company to takeover.

South Sudan's strategic considerations regarding oil sector management appear to balance multiple factors: maintaining control over oil revenues while seeking foreign partnerships (with Chinese firms being a potential preference due to their different reporting requirements compared to Western companies), all while needing to maintain constructive relationships with international financial institutions and development partners to ensure continued access to aid and development funding. This complex dynamic may explain their measured approach to sector decisions.

The risk here is that if they continue for too long in this regard than they will struggle to get any investment and we all know they haven’t got the technical or financial capacity to run the fields and continue exploration.

South Sudan oil sector gets a reference here

Oil sector - https://m.youtube.com/watch?v=obJvEErqqCQ

At the same time I hope that AK sees the opportunity that Nigeria still presents and is targeting a deal in Nigeria all signs point towards we would be looking at deals considering favourable PR we have received from the Nigeria gas minister so we have clearly proven ourselves to be reliable operators that get stuff done, the question probably remains are there any assets available that we are interested in on our favourable terms which provide scale and material reserve upside. Nigeria has plenty and how quickly the Nigerian regulator is willing to approve this obviously I wouldn’t want a similar 32 month period which sell at went through. But if Savannah can get approvals and regulator onside prior to SPA than should make the regulator process quicker and smoother with expedited timelines

Brilliant for replay holders deal finally closes after 32 months. Patience and reward truly paid off for replay shareholders. It was circa 85p in December 2022. Nearly done 200% and more to come once the Exxon Nigeria assets and production and reserves hit the balance sheet. Could see it 400p+ plus in the next few months.

Just goes to show African deal making is a long slog and not one for the impatient. I sincerely hope our day of share price growth and reckoning also comes similar to the value growth seplat has demonstrated. I believe we are 6-12 months behind them on our growth curve but truly believe we can do similar, just requires our patience. Final deal details should be released soon so it would be interesting to read the terms they have closed under after such a long time and what the economic interest date it and the structure of the deal.

https://www.reuters.com/business/energy/nigeria-approves-exxon-seplat-128-billion-deal-oil-regulator-says-2024-10-21/